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Welcome to another episode of Monday Mortgage Madness! In today’s article we are going to reveal 3 ways to save some money in your transactions before closing on a home.

When you order your appraisal be mindful of a couple things:

Have it done upfront. Any health or safety related.You have to make sure all repairs get taken care of, before you move into a new property.

During the inspection portion of the home appraisal, the appraiser considers both the interior and exterior of a home to get the best value of the house.

Exterior-wise, the appraiser will consider:

The total land area or acreage of your property

The condition of the property

Any lead or peeling paint, but only if the house was built prior to 1979

Interior-wise:

Working furnace

Working air conditioning

Number of rooms, although they will also consider windows and closets

Garage, although it does not contribute to the square footage of the home

Upgraded basement, although it does not contribute to the square footage of the home

Built-in appliance upgrades

In-ground pool

If you decide to make upgrades in your home, you need to make sure they are completed before you schedule an appraisal. Unfinished projects reflect poorly on the home value and you will be affected by appraisal extra fees.

The same goes for the presentation of your home. While an appraiser cannot take the overall cleanliness and style into account, the estimated value of your home may be affected by holes in the wall or peeling paint, for example.

Home Appraisal Checklist

The appraiser will also look for anything needing repairs. Here are some things to check out before your appraisal:

Check your electric garage door opener to make sure it’s working

Secure a handrail on steps or stairwells

Secure second floor doors with decks

Secure a railing to any and all raised decks

Ensure all utilities are functional with no safety issues

Ensure water, electricity and air conditioning is functional

Address any plumbing, roof leaks or stains

Check for cracks in the walls, ceiling or foundation

Check for water intrusion through the foundation

Ensure your roof is sound and has at least three years of economic life remaining

By addressing all these, you’ll be better prepared for an appraisal inspection and you’ll likely improve your home’s value.

2. Funds need to be verified

Evidence of Proof of Funds for Balance of Down Payment

Then we have the funds required to close escrow, the balance of the down payment plus closing costs.

The process is always the same: the buyer needs to present certain documentation and get it verified.Here are a few sample types of documentation:

– Original bank statement

– Online banking statement

– An open equity line of credit

– Copy of money market account balance

– Certified financial statement

3-.Keep your credit cards at same balances

Many of you may not know that making moves such as buying furniture before closing on a home, may make a big difference actually.

When you are in the final stages of getting a mortgage, it’s a good idea to stop using your credit cards, or at least cut way back on credit card spending. Stay patient and be cautious and you’ll secure your future house.

So that’s all for today, hope you found this article useful so far and don’t hesitate in reaching me out if you have any questions or need a consultation.

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In today’s post we are going to talk about homeowners insurance and hazard insurance, and why it is so important in order to protect property owners against the possibility of any possible thefts or damages from fires or any unfortunate natural events earthquakes, storms…

When someone applies for a mortgage, it is requested to give proof of insurance in the property so that the bank can issue the mortgage. When it comes to home insurances, homeowners can get either take a look at all the options and pick one that suits best their needs, or leave it in the hands of their banks, which will add an extra cost to the mortgage given.

What does a homeowners insurance cover? Interior damage, exterior damage, loss or damage of personal assets/belongings, and injuries that may arise while on the property. However, it’s important to remember when a claim is made by the homeowner, he/she will have to pay a deductible, which will be calculated based on the type of insurance policy, excess costs..etc

What is key here is to keep in mind is that the higher the deductible is on an insurance contract, the lower the monthly or annual premium on a homeowners insurance policy will be.

But of course, there is a liability limit, that usually stands at around $100,000, but it can go higher depending on the policyholder. What the liability limit does, is to estimate the percentage of the coverage that would go toward replacing or repairing damage to the property structures, personal belongings, and costs to live somewhere else while the property is worked on.

The reason why at Sean La Rue Home Loans we think it’s a must to get hazard insurance when you acquire a property is because your average home insurance won’t usually cover all sort of damages that your place could suffer. Acts of war or acts of God will usually not be covered in a homeowners insurance policy. Its actually a common requirement from a lender to ask to have a minimal hazard insurance when applying for a mortgage, to protect the investment and value of the new home.

Think about it this way: it’s much easier to deal with the cost from hazard insurance than having to pay off all the costs generated from an unfortunate event that may happen to your property. Better to be cautious than taking risks with this kind of stuff, specially when living in high-risk areas. Whenever you buy a home, you are making an investment. You are investing so much out of your pocket every month in that investment, so why not spending a couple hundred more per year to insure it?

How much hazard insurance do I need for my home?

We’ll know how to estimate how much hazard insurance is actually needed for our particular case based on how much cost would we have in the worst case scenario(event of a total loss). This amount may change from one year to another, and could be significantly different from the property’s value, that’s why policies are usually written for one year and renewable. It’s very common that lenders include the costs of hazard insurance in the monthly mortgage payment.

And that’s all for today’s post, hope you found it useful and don’t hesitate in reaching me out if you have any questions or you are interested in making a consultation.

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As we mentioned in the video, C.I.A stands for credit, income and assets. We are going to go more in deep in this article about these 3 to learn what it takes to increase our chances of getting pre-approved for a mortgage.

Here are the list of things we’ll have to pay attention to and how everything works:

1. We need to prove our income

Nowadays, we need to be prepared to start the process of getting a loan, by giving all kinds of documentation about the different sorts of income that we may have, such as:

W-2 statements from the past 2 years

Year to date income

any recent pay stubs that show income

2 most recent years of tax returns

Any additional income(alimony, bonuses..etc)

2. We need to prove our assets

In terms of assets, we need to give proof of that we are in a position where we can afford paying the down payment and closing costs, as well as having some cash reserves after that. Normally there will be other requirements such as having to get private mortgage insurance or paying a funding fee, unless we put 20% down.

Also remember that your pre-approval will be based on your FICO credit score, debt-to- income ratio and other factors, and that all loans, except Jumbo loans, are conformed to GSE guidelines.

3. We need good credit

You will find that most lenders require at least 620 FICO score or above to get your loan approved, even for FHA loans sometimes. What are FHA loans? they are those that require lower minimum down payments than conventional loans. For these, as we mentioned in the video you’ll need at least a 580 credit score to get pre-approved. However, if your score is lower, you can still get a FHA loan with a 10% down payment.

If you have a high score (760 or above) lenders will offer you low interests, but if on the other hand, you have a low credit score, don’t worry as lenders will suggest ways to improve your score. The only downside for low score borrowers will be that they’ll have to pay their mortgages in longer periods of time.

That’s all for today, hope you found this content useful and don’t forget to follow Sean La Rue in all social media to stay tuned to all kinds of information about qualifying, real state finance… This has been the first of many articles for Monday Mortgage Madness.